updated 11:30 am EST, Thu December 23, 2010

FCC to push Comcast-NBC neutrality and video rules

The FCC today said through unofficial channels it would likely demand tough conditions of the proposed Comcast-NBC merger. The deal will require Comcast to obey net neutrality rules more specifically and will prevent it from blocking or otherwise interfering with competitors' Internet traffic. It would further prevent 'positive' violations of neutrality, the WSJ heard, by prioritizing its own Internet video above others.

Comcast would also be legally required to give online video to others, including those who have deals with other content networks. Concerns had existed that Comcast would deliberately withhold video for iTunes, Netflix or any other service that would let customers skip its much more expensive cable packages. The company had objected to requiring openness.

Regular TV would have its own conditions and require that Comcast give NBC content to paid TV services at reasonable rates. Channels from a given category would also have to be placed close to each other in the official channel order to prevent Comcast from deliberately segregating competitors and making it difficult to watch alternatives to NBC.

The measures aren't taking effect today and will require majority approval from FCC chairman Julius Genachowski and the four other commissioners. Whether or not the deal will go ahead is less certain than for the net neutrality law. While the Comcast deal went through in part due to Democrat support for tougher monitoring of practices, the new deal may face opposition from these same parties worried about media consolidation even with the conditions in place.

If passed, the terms might still help satisfy some of Level 3's complaints against Comcast. Although the FCC now considers it a network peering dispute and not a net neutrality issue, it would give more of a bargaining chip for future negotiations on Level 3's carriage of Netflix traffic and prevent Comcast from using Netflix support to hurt the Internet backbone provider. Companies like Apple or Amazon might also be happier as Comcast wouldn't have any additional leverage by demanding price hikes.

When the final vote will occur still isn't known, but Comcast has already said it doesn't expect the deal to be approved until at least January.

GOOD

I hope that this was the right thing to do

I know Comcast hasn't exactly been a popular ISP for a while now, but all animosity and valid complaints aside, I can't help but feel that there was some sort of rash action taken here today that may have overlooked the realities of the situation Comcast is facing.

How do they afford to grow their networks enough to comfortably handle increased traffic from streaming video when there is little opportunity left for adding new broadband subscribers, if not by raising customer rates (since they apparently can't raise the rates of tube-fillers like Level 3)?

Who knows, maybe Comcast has plenty of capacity in their network and this really was some sort of conspiracy to help their TV business. I'm just not convinced that we know all the facts here.